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Ford City facing sizable jump in medical coverage for employees

| Tuesday, April 1, 2008

FORD CITY -- The borough is facing a sizable jump in the cost of medical coverage for employees. It received a renewal from its health insurance carrier, Highmark Blue Cross Blue Shield, that is 49 percent more than last year, borough officials said.

The coverage will cost the borough about $85,000 more a year in insurance premiums, increasing from about $14,000 a month to $21,000 a month, officials said during a special public meeting Monday.

The borough saved about $120,000 last year when it changed coverage to Highmark Blue Cross Blue Shield.

Councilman Tim Malec said council budgeted for a 15 percent increase this year. The higher-than-expected raise in the premium could result in as much as a 3-mill tax increase, he said

Council debated dealing with the increase.

Councilman Tom Shaffer suggested changing insurance brokers from the current broker, Babb Inc, of Pittsburgh, to Michael Baer of Davevic Benefit Consultants. Rob Watt of Watt Insurance Agency in Ford City would be the local representative, Shaffer said.

"We're stuck with it (the rate increase) for the year," Shaffer said. "Let them evaluate our insurance and look at saving some money. So we can make an educated and intelligent decision in our future health care."

Council listened to former council member Renee Zacour, who was at the public meeting and had negotiated the former health insurance contract.

Zacour disagreed with changing brokers.

"The increase was so high because we're a small group (and there were some claims)," Zacour said. "Kittanning (borough) received a 49 percent increase too."

"We need to leave Blue Cross Blue Shield for one year," Zacour said. "Shop it. Put it out to bid."

Kim Bish, a borough resident with 25 years experience in the health insurance field, agreed with Zacour.

Malec made a motion to form a committee to review lowering the health insurance costs. Malec included Zacour and Bish along with appointed council members on the committee. The motion passed by a 4-1 vote with Shaffer casting the no vote.

It was suggested by several members that council, after a year away from Highmark Blue Cross Blue Shield, go back to that carrier through the Steelworker union's health insurance fund.

Council is negotiating a new labor deal with its employees who are represented by United Steelworkers of America Local 158. Health care insurance is included in those talks.

In other borough business, council:

-- Voted to rescind a decision that authorized conveyance of six acres of vacant property in the borough's industrial park to the Greater Ford City Development Corp. for $1. The sale was contingent on Carson Industries reaching an agreement to buy property. When that did not occur, the sale to the CDC was to be null and void.

Borough solicitor Frank Wolfe said the second vote was acknowledgment of the original motion.

Development authority

Council discussed creating a nonprofit economic corporation called the Ford City Development Corp. in tandem with the existing Greater Ford Community Development Corp. (GFCCDC). The motion for a second CDC body was made by Shaffer.

Council at a previous meeting voted to negotiate with the GFCCDC to reorganize it.

"We need a new development authority," Shaffer said. "We're being stalemated in those negotiations. It's time to start working on a Plan B -- start organizing a new nonprofit CDC."

Councilman Ron Dillard said negotiations with the CDC are moving along.

"We're only one meeting away from bringing it (the reorganization and procedures) back to council," Dillard said.

The CDC board has recently grown from six to nine members. When it was formed several years ago there were 13 members and an executive director.

Lou Vergari (president), Jo Ann Scopel, Greg Dinko, former council members Homer Pendleton and Zacour and current councilman Malec are members.

New members are Bish, Dennis Mantini (brother of Mayor Marc Mantini) and Jennifer Klukan (niece of councilman Ray Klukan and experienced in the real estate field), according to Scopel.

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